Dongguan: Clothing exports are “blowing with warm air” and competition intensifies as orders improve

Huangpu Customs recently released textile and clothing export data from January to April this year. According to customs statistics, from January to April this year, Dongguan’s exports of clothing and clothing accessories totaled 8.98 billion yuan, a year-on-year increase of 9.4%, continuing to show a recovery trend.
From the perspective of the industry, this export data is a good thing for the global economy to improve. However, in recent years, due to the impact of rising raw material and labor costs, as well as the return of manufacturing industries in Western countries, Dongguan’s export orders for textiles, clothing, shoes and hats have been overwhelmed by emerging markets such as Southeast Asia. The hidden worry of market poaching.
In the long run, some experts have pointed out that Dongguan should learn from the development trajectory of fashion cities in developed countries in Europe and the United States, and integrate fragmented resources such as Humen Clothing, Dalang Woolen Weaving, Houjie Shoes and Bags, and Changan Jewelry from the municipal government level to create a fashion industry. belt to cope with a new round of manufacturing crisis.
Export growth to the EU reached 35.6%
Textile and apparel export data has picked up. From the perspective of the industry, this data “looks good.” In fact, since mid-2014, as the economic environment in Europe and the United States has recovered, many Dongguan companies have placed more orders than in 2013.
From the data point of view of the export market from January to April this year, the EU, Hong Kong, China, and the United States are still the three main export markets. Among them, Dongguan City’s clothing exports to the EU were 2.33 billion yuan, an increase of 35.6%; exports to the United States were 2.08 billion yuan, an increase of 6.8%; exports to Hong Kong were 1.65 billion yuan, a decrease of 13%; the total exports to the above three markets accounted for 67.4%.
In addition to the improving global economic situation, the main reason for the growth of the textile and apparel industry in 2014 was first of all due to policy support. Since 2014, the State Council has introduced a series of policies and measures to stabilize foreign trade growth, and has introduced a new batch of measures to “promote the development of cross-border e-commerce” and “comprehensive service and support policies for foreign trade enterprises” to further improve trade facilitation. level, alleviating the rising pressure on the comprehensive cost of foreign trade.
Secondly, it is due to the fact that enterprises actively seek transformation and upgrading, and enhance their export competitiveness through information transformation, production line improvement and other measures. According to statistics from relevant departments, at the end of 2013, in order to save costs, many textile and garment companies started with management and improved monitoring efficiency through ERP management software, which relieved inventory pressure to a certain extent.
“The pain point in the development of clothing enterprises is labor-intensive. For example, the order quotation for a piece of clothing, from fabrics, pattern making, processing and other links, to calculate step by step, used to take at least three days.” Mr. Li, the person in charge of Dongguan Taifeng Garment Manufacturing, said, Now using information technology, prices can be quoted within 24 hours. Mr. Li said that by using the ERP system to achieve refined management, many small orders can be put together. Through precise calculation and unified quotation, the cost price will be significantly reduced.
In addition to information technology, a large number of companies are also developing customized clothing. It can be said that the active transformation of enterprises has played an important role in the improvement of Dongguan’s textile and apparel export data.
Southeast Asian Countries
Grab orders
The trend is obvious
However, what is not optimistic is that most textile and garment companies in Dongguan are engaged in brand OEM. Most textile and garment factories are labor-intensive enterprises. Only some processes can be replaced by machines. Considering the advantages of manpower, land, trade, etc., the relocation of production bases The trend is likely to expand further.
Therefore, Dongguan is facing fierce competition from countries in Southeast Asia and other countries. When companies are looking for export breakthroughs, they are subject to multi-party competition from Cambodia, Bangladesh, Vietnam, Pakistan, India, Sri Lanka and other countries.
According to authoritative reports, in the U.S. textile and apparel market, products mainly come from China and Vietnam. In 2014, China’s textile and clothing exports to the United States reached US$33.45 billion. In the first two months of this year, Vietnam’s textile and clothing exports reached US$3.4 billion, an increase of 15.8%, a record high; in March, Vietnam’s exports of garments and textiles to the EU increased. 7.5%. As the world’s second largest textile and apparel exporter, India recently announced its foreign trade policy from 2015 to 2020. The focus of the new policy is to promote textile and apparel exports.
“The labor force in Southeast Asian countries is relatively cheap, especially the tariffs in these countries are low. Some countries such as Bangladesh and Cambodia even implement zero-tariff policies. This has made Dongguan inevitably compete with these countries and regions for foreign markets. At a disadvantage.” Analysts from the Dongguan Textile and Apparel Industry Association said that the European Union, the United States and Hong Kong are old markets for Dongguan’s garment exports, and have not changed much due to the impact of the general environment, but it should also be seen that the market share has a shrinking trend.
Some people also believe that although Dongguan has certain advantages in design and technology compared with these countries and regions, they have to admit that these countries and regions are working hard to narrow the gap with Dongguan and competition from these countries and regions Not to be underestimated.
In addition, textile and garment companies have been troubled by the appreciation of the RMB and the sharp rise in raw material prices. At present, many orders have flowed to competitors such as Vietnam, Cambodia, and India. It can be seen that orders are shifting to emerging manufacturing countries with lower costs.
The fashion industry belt is difficult to implement
Dongguan’s clothing, footwear and hats industry has made remarkable leaps and is now moving towards “”Extending both ends and lifting in the middle” is transforming the smile curve. However, from the perspective of the long-term path of industrial development, the traditional thinking of manufacturing industrial products can no longer meet the diverse and personalized needs of consumers.
The Department of Economics and Trade of Dongguan Institute of Technology once suggested that Dongguan should start from a higher intention. First of all, Dongguan has all the elements of the three levels of the fashion industry and has unique conditions for the development of the fashion industry. Dongguan must not only insist on gradually transforming from pure processing and manufacturing in the past to integrating high-end R&D and design, advanced manufacturing and brand marketing, but also learn from the development trajectory of the fashion industry in developed countries around the world.
For example, Dongguan should integrate existing industrial resources from the perspective of the fashion industry, break the siled pattern of towns and streets, form a consensus on industrial development, and jointly build the Dongguan fashion industry belt, namely Houjie-Humen-Chang’an-Songshan Lake-Dalang-Huangjiang ―Tangxia, a high-level construction of an international one-stop fashion industry procurement center, uses a combination of physical operations and e-commerce to expand domestic and foreign markets, especially the domestic market.
Furthermore, Dongguan should coordinate high-level marketing of the fashion industry at the municipal government level and jointly hold high-level fashion exhibitions covering three levels of the fashion industry. Through these measures, we will break through the constraints of the fashion industry and create an aircraft carrier for Dongguan’s fashion industry.
However, this view is difficult to implement in reality. On the one hand, the overall advantages of the fashion industry must break through the economic barriers of the town and street princes. Humen clothing, Dalang woolen fabrics, Houjie shoes and bags, Chang’an jewelry, etc. must be closely integrated and complementary. This in itself is a need from the municipal government level. A huge project to advance. “Grassing large projects and supporting strategic emerging industries are currently Dongguan’s main measures to improve regional competitiveness. The official focus on traditional advantageous industries seems to be somewhat overwhelming.” said an unnamed industry insider.
“The industrial chain cannot release comprehensive potential energy, and it is still low-level and small-scale. It is a pity that these living fashion elements are not examined from the perspective of the fashion industry.” The industry keeps sighing like this.